Understanding the Differences in Wills and Trusts
Taking care of our family is the highest priority we all have. You may have your wealth set up to take care of your family now, and in the future, with essential items like health insurance or fun activities like travel and building memories. But you may not have put much thought into preparing your assets for after you are gone. Even if you have started, your estate plan may need to be updated to ensure your wealth is transferred to your loved ones smoothly.
If this sounds familiar, don’t worry. We will be discussing the main areas of estate planning, wills and trusts.
In our newsletter, Wills and Trusts: The Foundations of Your Rock-Solid Estate Plan, we take a closer look at how these tools can work to enhance your estate planning strategy.
Everyone should have a will.
Yes, everyone. Do you have one? A will should be the first step you take when you start estate planning. A will states exactly where you want your finances to go after you are gone. Without it, your family may struggle to settle your estate.
As with any decision, there are always positives and negatives. In the newsletter, we discuss advantages and disadvantages of creating a will. Here are examples of both:
Advantage – “You decide on the disposition of your hard-earned wealth.”
Disadvantage – “You have to accept that one day – far in the future – you just might die.”
Differences Between Wills and Trusts – Which Is Right For You?
The second planning tool you should think about in a smart estate plan is a trust. A trust is administered by appointed trustees, who will carry out your wishes on behalf of your beneficiaries.
There are two types of trusts: Living and Testamentary. And all types of trusts can also be revocable or irrevocable. Living trusts can avoid the cost of probate, avoid publicity, and reduce the risk of the estate settlement being contested. A testamentary is created within your will after you’ve passed.
Wills are viable only at death and they are public documents. In contrasts, living trusts can have uses while you’re alive and are private.
“Living trusts are sometimes said to be superior to a will, but that is certainly not the case for everyone.”
Find out more in our newsletter, where we discuss living trusts and probate in greater detail. Read it below or click here to download as a PDF.
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Financial Harvest Wealth Advisors Team
The Financial Harvest Wealth Advisory team is dedicated to helping address the unique financial planning needs of each family, business, or individual that we have the privilege to serve. Our team members are focused on client success and helping our clients realize their most significant and meaningful life goals.
